need help with part 3

Part One, Two and Three Instructions Record the January 2018 transactions in the general journal (last section of this practice set) using the following events. Skip a line between each entry and number the entries to match the number of transactions. In the general journal record the transaction number, the date, and the account numbers. After all journal entries are entered into the practice set, enter the adjusting journal entries. Next, create a T-Account for each account that is used in the Chart of Accounts and record the transactions and end with an ending balance. All ending balances should be on the normal balance side even if the account has a zero balance. If there is a number that is uneven round to the nearest cent. You will need the ending balance in the cash account for the bank reconciliation. All instructions for Blackboard start on page 6. Transactions 1. 2. 3. 4. Date 1/02/18 1/02/18 Deposit #1 1/03/18 Deposit No. / Check No. 5. 1/03/18 Ck #1001 1/03/18 Ck #1002 Description Ivan Smith met with his lawyer and CPA for advice on starting the business. They decided that Mr. Smith would organize the business as a corporation. The lawyer told Mr. Smith to register the company name, Ivan's Instrument Center, with the County of El Paso. In addition, Mr. Smith will get an employer identification number (EIN) from the Internal Revenue Service and get a sales tax permit from the state of Texas. The lawyer agreed to prepare the Articles of Incorporation to be filed with the Secretary of State of Texas. The CPA has agreed to help Mr. Smith set up his accounting system. Mr. Smith opened a business checking account at Wells Fargo Bank by depositing $30,000. The corporation issued him a stock certificate for 2,000 shares of common stock with no par value. Mr. Smith signed a one-year rental agreement with Reynolds Realtors for warehouse space. He was required to pay $3,400 for rent for the months of January 1, 2018 December 31, 2018. Arranged for a general business liability insurance policy and paid $3,600 to State Penn Insurance. This premium is for eighteen months coverage. Purchased a new computer system that cost $3,000 from Office Mart for use in the business. Mr. Smith signed a six-month, 12% installment note payable for the cost of the system. The computer system has an estimated useful life of 3 years and the residual 6. 7. 1/05/18 | 8. 1/05/18 Deposit #2 9. 1/06/18 Ck #1004 1/06/18 10. 1/08/18 11. 1/08/18 14. 1/18/18 12. 1/13/18 Ck #1006 13. 1/18/18 Ck #1003 17. 1/16/18 15. 1/18/18 Ck #1007 16. 1/18/18 Ck #1005 19. 1/22/18 18. 1/20/18 Deposit #3 20. 1/23/18 Ck #1008 (salvage) value is $0. This will be recorded as Computer Equipment, and depreciated using the Straight-Line Depreciation method accordingly. Signed a note payable to borrow $8,000 from Wells Fargo Bank. Interest is 7% annually and the note is to be repaid with interest in six months. Purchased a delivery van for $18,000 from Tony's Motors. The estimated service life of this asset is 5 years. The residual (salvage value) is $2,000. This will be recorded as Delivery Van and depreciated using the Straight-Line Depreciation Method. Paid $800 to have Ivan's logo painted on the side of the van. This should be added to the cost of the van and depreciated over the life of the van. Paid $700 for business cards, flyers, and posters. This will be recorded as prepaid advertising. Purchased $10,000 of inventory-guitars from Gary's Guitars on account. The vendor extended credit terms of 2/15, n/30. Purchased $8,000 of inventory-violins from Vic's Violins on account. The vendor extended credit terms are 2/10 Mr. Smith received and paid the $900 charge from his lawyer. Ivan's Instrument Center is now open for business. Sales will be both retail and wholesale. Retail customers will purchase online and at the shop and will be charged an 8.25% sales tax. Mr. Smith will allow major customers to charge their purchases on account. Purchased $200 of supplies consisting of instrument strings, pics, and resin and purchased them on account. Purchased shipping supplies of $500 for cash. Sold instruments to Sue's Junior Symphony and Ensemble for $7,670 and the sales tax collected is $633. The cost of the guitars is $3,000 and the cost of the violins is $1,600. Sue's Junior Symphony and Ensemble paid on account and Ivan will bill them. Purchased additional guitars on account for $3,500 from Gary's Guitars. Credit terms are 2/15, n/30. Recorded internet sales for the first five days of operation. Sales totaled $7,000. The sales tax collected totaled $450. The $7,450 was deposited in the bank. The cost of merchandise sold was $3,900 (guitars cost $3,500; violins cost $400). Received and paid the $200 invoice for supplies (strings, resin and pics) purchased on 1/18/18. Mr. Smith donated a guitar and a violin to the National Music Society fund raiser. He felt that this was a good way to advertise his 21. 1/23/18 22. 1/23/18 23. 1/23/18 24. 1/23/18 25. 1/23/18 26. 1/25/18 Deposit #4 Ck #1009 30. 1/31/18 Ck #1010 Deposit #5 Ck #1011 Deposit #6 27. 1/28/18 28. 1/30/18 Ck #1012 29. 1/30/18 Deposit #7 Ck #1013 31. 1/31/18 Ck #1018 new business. His business was listed as a sponsor and a large ad was put in the fund raiser program. Cost of the guitar was $250 and the violin was $200. Mr. Smith considers this an advertising expense. Received payment in full from Sue's Junior Symphony and Ensemble. The payment was deposited in the bank. Mr. Smith paid his credit card bill for the month. The total was $480 which was for gas for the delivery van. Paid for the violins purchased from Vic's Violins on 9/08/18. Internet and retail sales totaled $10,000 and sales taxes of $825 was collected. The cost of the merchandise sold was $5,700 (Guitar $4,500; violins $1,200). The money was deposited in the bank. Paid the balance due to Gary's Guitars. There are two invoices; one on 1/8/18 and the other on 1/16/18. Sales of $5,000 was deposited from online customers and $413 of sales tax was collected. The cost of the merchandise was $500 for guitars and $2,000 for violins. Received but did not pay the phone bill for the month, $165. Paid the first monthly installment on the computer equipment. The payment amount is $530. Of this amount, $30 is for interest and $500 is for principal. Make the check payable to Office Mart. Recorded internet sales for the last week of the month. Sales of $4,500 were deposited. The cost of the merchandise sold was $2,250 (guitars $250; violins $2,000). Sales tax collected is $371. Paid all sales tax owed for January to the Comptroller of Public Accounts. Declared and paid a cash dividend of $200 to Ivan Smith. Part Three Instructions In this part of the practice set, the student will prepare a T-Account for each account and calculate the ending balance in each T-Account. In Blackboard the student will write: Dr or Cr (depending on the balance in the account) then the account number, then the dollar amount. Here is an example: Dr 10000 $5,345.00 or Cr 20000 $4,110.00 Only write whether it has a debit or credit balance then the account number then the dollar amount for each account. Cash Debit Credit 0 Accounts Payable Debit Credit Sales Debit Credit Rent Expense Debit Credit Depr. Expense- Computer Equipment Debit Credit Accounts Receivable Debit Credit 0 Ivan's Instrument T-Accounts Shipping Supplies Debit Credit Prepaid Insurance Debit Credit Accumulated Depr.- Equipment Debit Credit Sales Tax Payable Debit Credit COGS Debit Credit Utility Expense Debit Credit Depr. Expense - Delivery Van Debit Credit 0 Inventory-Guitars Debit Credit 0 Delivery Van Debit Credit Wages Payable Debit Credit Advertising Expense Debit Credit Interest Expense Debit Credit Bank Service Fee Debit Credit Supplies Debit Credit Inventory-Violins Debit Credit Accumulated Depr.- Delivery Van Debit Credit Utilities Payable Debit Credit Legal Expense Debit Credit Supplies Expense Debit Credit Prepaid Advertising Prepaid Rent Debit Credit Debit Credit Computer Equipment Debit Credit 0 Note Payable- Office Mart Debit Credit Capital Stock Credit Debit Credit Card Expense Debit Credit Shipping Supplies Expense Debit Credit Note Payable - Wells Fargo Debit Credit Dividends Debit Credit Insurance Expense Debit Credit Wages Expense Debit Credit